In 1900, American historian Henry Adams, scion of U.S. presidents, was in
Paris to cover the world’s fair for the Boston Globe. The highlight of the
Paris Exposition, held to celebrate the arrival of the 20th Century,
had been the illumination of the bridges across the Seine by electric lights.
While Adams marveled at the spectacle, his commentary also reflected his
disappointment that electricity had not produced the great benefits that its
proponents had promised at the beginning of the electro-mechanical age.

Since the middle of the 19th Century, the inventors of electric
power — e.g., Kelvin, Siemens, Edison and others — had been describing the
wonders of the all-electric world to come, in which a cornucopia of labor-saving
devices would remove the burdens of domestic work from housewives, and clean
electricity would clear the air of soot-choked industrial cities by providing
factories and railroads with a smoke-free source of power. But by 1900, 43 years
after Siemens had perfected the dynamo and 30 years after Edison and
Westinghouse had begun selling electricity to local consumers, the most notable
achievements of the new technology had been safer theater lighting, and the
illumination of a number of public buildings and major thoroughfares.

Similarly, back in the 1950s, the pioneers of the information age — e.g.,
Weiner, Diebold, Beer, etc. — had promised us paperless offices and cashless
commerce. Yet, as we entered the 1990s, 43 years after the first computer had
been demonstrated (1946), and 35 years after the sale of the first commercial
computing systems (1954), most offices remained awash in paper, and our
principal use of the electronic banking system (even today) is to get cash from
one of our 275,000 ATMs. As Nobel Laureate economist Robert Solow mournfully
observed at the end of the 1980s, "We see computers everywhere today,
except in the productivity statistics."

The misgivings expressed by both Adams and Solow were engendered by a single
common problem experienced by futurists, called technologic "presbyopia,"
or far-sightedness. Basically, it is possible for an expert to envision the
ultimate capabilities of a newly-invented technology long before that technology
can be refined and developed to the point that it actually performs at its full
productive potential. In fact, economic historians have concluded that, during
the first quarter-century following a new technology’s initial demonstration,
the technology remains so primitive, costly, and unreliable that it finds only
limited specialty applications in the marketplace, and has no measurable impacts
upon a nation’s overall economic performance.

During the second quarter-century of a new technology’s existence, it
typically is refined and applied to a growing array of practical marketplace
functions. But the technology is still immature during this stage of its
development; it is still expensive, unreliable and difficult to use. Most of the
extensive — and costly — applications of new technologies during this second
stage of adoption typically fail to improve performance. As a result, the second
quarter-century of a new technology’s introduction actually causes a nation’s
productivity-improvement rates to fall, along with average wages,
corporate profits and prosperity in general. For electric power, this
"counter-productive" stage of technologic introduction and application
lasted from 1880 to 1905. The counter-productive phase of America’s adoption
of information technology ran from the early 1970s to the mid-1990s.

The good news, say the economic historians, is that, once a technology has
been around for 50 years or so, it generally becomes cheap enough, reliable
enough, and useful enough that it can finally produce the results that its
proponents had originally envisioned a half-century earlier. Within three years
of Henry Adam’s gloomy pronouncements on electric power, for example, every
major city between Chicago and Budapest had begun to convert their urban
commuter railroads from steam to electricity. By 1905 to 1907, the first power
distribution grids were completed in Europe and North America, giving millions
of households and businesses access to low-cost electricity for the first time.
In the 20 years that followed, electric appliances appeared in millions of
homes, while tens of millions of workers got new electro-mechanical tools;
productivity soared, the economy expanded, and a rising tide of prosperity
"lifted most of the boats."

History shows us that seven-eighths of a new technology’s impacts do not
occur until the final quarter-century of its adoption by society. Furthermore,
during this high-impact stage of adoption, a newly-mature technology has
typically attained such marketplace leverage through its competitive advantages
that it coerces the transformation of most existing institutions, and fosters
the invention of entirely new ways of doing essentially everything. In short, a
newly-matured technology is a revolutionary technology.

Between 1900 and the mid-1920s, the general assimilation of
electro-mechanical technologies — including the telephone, automobile, motion
picture and radio — not only sustained a quarter-century of soaring
productivity and prosperity, it also led to the re-invention of many of our
existing institutions, including colleges and universities, healthcare, local
government, retailing, etc. — and to the invention of entirely new social
technologies, including universal public education, workman’s compensation and
unemployment insurance, credit unions, social security, the graduated income
tax, public relations, scientific management and the suburbs.

America entered the high-impact, transformational phase of the Information
Revolution in the mid-1990s. Our productivity-improvement rate, which had
averaged one percent per annum since 1969, doubled in 1992; and since 1996, it
has averaged more than three percent per annum. Rising productivity, in turn,
has made it possible for employers to raise wages without raising prices, a
combination that has sustained the longest period of unbroken economic growth in
modern U.S. history.

And this is just the beginning! The Labor Department projects that, at
current productivity-improvement rates, average household income in the U.S.
will rise from $43,500 per annum to $70,000 per annum by 2020. What’s more, as
we pass further into the high-impact 25 years of the Information Revolution, we
will once again find ourselves re-inventing our principal institutions and
creating new social technologies to make the fullest productive uses of
computers and our new information infrastructure — or
"info-structure" — the Internet.

The transformation is already underway, and it will only accelerate over the
next 10 years, as cashless commerce, ticketless travel, campusless colleges and
(yes) paperless — even office-less — offices, all become commonplace. A
near-term future that will be dramatically different from our recent past now
lies immediately before us.

Just look at the data. It took 38 years for radio to amass an audience of 50
million people. It took television 13 years to reach 50 million people, and it
took the Internet just four years. In 1997, the U.S. Commerce Department
reported that, for the first time, more e-mail had been sent than were letters
through the Post Office. In October 1999, Postmaster General William Henderson
testified before Congress that e-mail has now exceeded paper mail by 50 percent.
Not only that, but the General Accounting Office has projected that declines in
paper mail will make it necessary to raise postage rates dramatically and begin
major layoffs by 2003. Over 100 million Americans are on the Internet today,
which means the on-line population is now a representative cross-section of our
society, and no longer just young white males looking for sex and violence. The
population on the Internet now is made up of more women than men; and later this
year, more foreigners than Americans will be on-line for the first time. (While
African-Americans and Hispanics remain statistically under-represented on the
Net, their numbers are growing.)

So, now that 180 million people worldwide are online, the compelling question
is: What are they all doing online? Well, we've got good data on that, too. We
know that 30 percent of the people online at any given moment are simply sending
or receiving e-mail. The other 70 percent say they are "looking for
information." Basically most people use the Internet as a sort of universal
reference library and Whole Earth Catalogue. Seventy-two percent of
Internet users say they use the Web to get information on products or services
before they make a purchase; over 30 percent say they use it to communicate with
a vendor from whom they have already purchased a good or service, in order to
complain, or make suggestions, or ask for parts or service. In this context,
many observers expect the Internet to usher in a new era of "interactive
consumerism."

To be fair, vendors and consumers have been interacting with one another
since the dawn of civilization. (After all, it’s in the nature of their
relationship.) But, in the mass markets of a modern global economy, the Internet
affords vendors and consumers an unprecedented capacity for two-way
communication. Economic models show that markets are more competitive — and
fair — when buyers and sellers are timely aware of the full range of offerings
in the marketplace. The 1996 Nobel Prize in Economics was awarded to William
Vickery and James Mirlees for demonstrating that both individual transactions
— and the economy as a whole — are more efficient when both buyers and
sellers are "symmetrically informed" about the objects of their sales
and purchases.

Of course, it is not at all clear that either the producers or the consumers
in most markets are particularly interested in keeping each other
"symmetrically informed." Public reaction to personal data gathering
and consumer profiling on-line has ranged from "concerned" to outright
hostile, and "personal privacy" has once again become one of the top
five political issues in the U.S. At the same time, manufacturers and service
providers routinely make decisions and engage in practices — ranging from
Third World subcontracts and retailer-price allocation formulae to political
contributions and genetically engineered foods — that they would prefer not be
publicly aired.

Whether or not we are pleased at the prospects of living in a cyber-mated
world, current trends suggest that, within 10 years, that’s where we’ll be.
Today, 75 percent of nationally-traded consumer products have a 1(800) WATS
telephone number printed on them, while about 10 percent display an
e-mail/website. But Internet use is doubling every 100 days, and the numbers of
e-messages sent each day now exceeds the daily numbers of telephone calls. It is
reasonable to assume that, whether or not most retail sales will eventually take
place on the Net, within 10 years, most buyer-seller/producer-consumer
relationships will be initiated and maintained in cyber-space, and not
face-to-face or over the counter. This same process of "cybernetization"
is also occurring in the public sector, in the relationships between elected
officials and their constituents, as well as between civil servants and the
citizen-taxpayers they serve.

While public institutions are often characterized as being slow to adopt new
technology, a larger percentage of government agencies have websites than do
for-profit organizations. And more government employees, per capita, use e-mail
than do the private sector employees. The public sector has been very keen on
the Internet as an economical means of communicating with constituencies. (It
was, after all, the public sector that conceived of, designed and installed the
Internet.)

Politicians, on the other hand, largely ignored the Internet in the 1980s and
early 1990s (except for the Far Right). Because the Net was originally
associated with the nation’s research universities, politicians (and almost
everybody else) did not think of the Internet as a "media for the
masses." Once it became clear that a principal capacity of the Internet is
to mass-produce relationships, the politicians jumped in. The 1998 elections
were the first in which essentially every candidate at every level of governance
had a website to raise money, find volunteers, and clarify issues.

As with producers and consumers, officeholders can use the Internet to reach
out to their constituents, and constituents can use the Internet to reach right
back: to praise or complain, to raise questions or make suggestions, and to
mobilize support or opposition with respect to any policy, legislation or any
individual politician. There is one website out there, www.e-thepeople.com, that
facilitates the ability of people who are dissatisfied with government programs
or services to go in and complain. All you have to do is log in and state your
problem or complaint, and the website will offer you contact information for
appropriate elected representatives and agency officials at all levels of
government, plus local media representatives. The website also helps you compose
e-mails to send to individual officials or representatives.

There are no websites quite like that for the private sector (yet), but it’s
surely just a matter of time. (It would be a natural feature for the Consumers
Union website.) The real threat posed to institutions from unhappy customers and
constituents (and disgruntled employees) on the Internet won’t be automated
letter writing websites, but the awesome power of mass communication that the
Net offers to an individual. In particular, any consumer or taxpayer who
believes that their health or safety, financial well-being, or civil rights have
been compromised by the actions of an institution, will be able to seek out and
mobilize similarly aggrieved parties. One angry buyer of a Packard-Bell
computer, convinced she had been sold a computer with outdated parts, set up a
Web page attacking the manufacturer, and inviting similarly-disgruntled
customers to e-mail her. The more than 1,000 replies she received were
subsequently transmitted to a lawyer to form the basis of a class-action
lawsuit.

A 1998 survey found that there were over 8,000 "gripe-sites" on
line, largely targeted at the world’s major producers of mass-market consumer
goods and services. While many have been created by unhappy customers, others
attack corporate ethics, labor practices, environmental behavior, etc. Using
off-the-shelf software, attack sites are often higher quality than the actual
corporate sites. By frequently citing their victim’s name on their Web page
and imbedding the name in the website’s "meta-tag," protesters
assure that their page will be pulled up by any of the major search engines that
consumers are likely to use in order to find the company’s actual website.

The information highway (I-way) is not only a two-way street, it is also a
two-edged sword. Unlike the Industrial era mass media — newspapers and
magazines, radio and television — which are all "one-way streets"
over which corporate and government information flows to the public in the form
of advertising, press releases and planted stories, the I-way permits consumers
and constituents to generate information flows — to each other, to regulators,
to the media and back to business and government institutions. What’s more, so
long as the so-called "attack sites" report only actual customer
experience, libel laws do not apply to such Internet activities. The
"McSpotlight" anti-McDonalds attack site continues to draw a million
hits a month in 22 nations around the world in spite of years of legal action by
the fast-food king to shut it down.

Mounting editorial, political, and academic concern has been expressed in
recent months about the growing threat to individual privacy posed by the
corporate collection and sale of personal data — especially data derived from
monitoring the activities of unsuspecting individuals while they are on-line.
While current privacy concerns are valid and serious, they are likely to be
resolved by a combination of new electronic security technologies and the
adoption of a European-model privacy protection statute, which simply treats all
personal information as personal property, subject to protection by law like any
other property. This approach to privacy protection, first adopted by the Swedes
in 1973, is straight-forward in application and enforcement, and has a good
track record in most European countries.

While the protection of privacy in cyberspace is a serious-but-manageable
problem, the increased capacity of single individuals on the Internet to mount
sophisticated, Hollywood-quality mass media campaigns attacking the products
and/or behavior of any large institution represents an increase in personal
power unprecedented in human history. As Sun Microsystems co-founder, Bill Joy,
reflected in his recent disquieting speculation ("Why the Future Doesn’t
Need Us," WIRED, April 2000), with nuclear weapons or bio-chemical
warfare, we worried about "rogue states"; in the wired world, we must
worry about "rogue individuals."

Within less than 10 years, the capacity to be a "rogue individual"
will be more or less universal. The notion of a "rogue individual" in
cyberspace immediately evokes the image of a computer hacker: an on-line
Unibomber seeding the Internet with a self-replicating
"denial-of-service" virus. (Mr. Joy’s WIRED essay dwells on
this very vision.) But for consumer affairs professionals, the really
provocative innovation of the next decade will be wireless internet, and the
Personal Digital Appliance (PDA).

By 2005, most people won’t leave home without their PDA, a combination cell
phone/pager/Net terminal/digital video camera. Whether or not all of our public
spaces are eventually going to be subject to television monitoring (a separate,
hotly-debated issue for the decade ahead), we can be certain that most people
will be able to record and report essentially everything and anything that they
encounter in the course of daily life — at the mall, on the road, in the
classroom, aboard the plane or cruise ship, etc. (In fact, media experts believe
that real-world footage of actual events, captured by eyewitnesses, will become
the principal content of WebNet newscasts, which are, in turn, expected to
supplant the broadcast network news programming within five years.)

We are about to enter a world in which every customer or client, every
employee, every passer-by or trespasser will also be a potential investigative
reporter, who is only a click or two away from being an on-line tabloid
publisher. This is consumer empowerment beyond the dreams of Ralph Nader and Sid
Wolfe. The work of consumer affairs professionals in the next 10 years will
become much more high tech and high profile, which will offer considerably
greater opportunity for consumer affairs to add value and improve overall
performance.